The ruched, off-the-shoulder, midnight blue velvet gown that the Princess of Wales wore when she memorably danced with John Travolta at the White House in 1985 will be the centrepiece of the biggest auction of Diana’s dresses when it takes place next week.

The gown, designed by Victor Edelstein, will be one of 10 going under the hammer and is expected to fetch between £200,000 and £300,000. An exhibition of the dresses is open to the public at the specialist fashion auctioneer London’s Kerry Taylor.

Mostly evening wear worn by Diana for official engagements between 1985 and 1997,the dresses are all made by British designers; long-term Diana favourite Catherine Walker has six dresses, and Bruce Oldfield and Zandra Rhodes also feature. The gowns were previously part of a private collection.

Other highlights include a Walker asymmetric gown with handmade sequins in delicate rose patterns that Diana wore when she met Liza Minnelli in 1991 , and a black Oldfield gown with low back and front necklines that she wore when photographed by Lord Snowdon. The Rhodes dress (which is handpainted) is expected to fetch £30,000 and the beaded black halterneck that Diana was photographed in by Mario Testino shortly before her death in 1997 is likely to reach £70,000.

The collection shows the princess’s evolution from Sloane Ranger to sleek sophisticate. “As a group, it’s fascinating to see the change from ingénue to style icon,” said Kerry Taylor. “You follow her life through clothes.”

From the 1985 Catherine Walker crushed velvet maroon gown with oversized bow to the sleek, column shapes of the nineties, a signature Diana style develops. Anna Harvey, now the editorial director of Condé Nast New Markets, but then a fashion editor at Vogue and fashion consultant for Diana, saw that happening. “She didn’t have strong sense of style at the start,” she Harvey. “It came with experience, as she became more confident, and bolder about how things should fit.”

“A whole generation was influenced by her,” said Oriole Cullen, curator of Fashion & Textiles at the V&A. “Even if you take her wedding dress – for 15 years after, people were still getting married in versions of it.”

Interest in Diana remains high, and is not harmed by the current positive feeling towards the royal family, in part owing to the wedding of the Duke and Duchess of Cambridge, the Queen’s jubilee and the upcoming new heir. Who will be buying Diana’s dresses, though, is anyone’s guess. “It’s a niche market,” admits Taylor. “A lot of people love Diana but most of then can only afford the catalogue. I’m hoping a museum will buy them and they’ll end up in the public realm. She’s the people’s princess but none of her dresses are on display for the people to see.”